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| Last Updated: Aug 15th, 2008 - 11:26:43 |
Newsletters
:
2007 Newsletters
:
2 March 2007
Thought for the Day
Russian government reduces taxes and increases revenues.
The World Bank points out that Russia slashed taxes by a third in 2001 and simplified the tax code: compliance increased and tax revenues, admittedly helped by energy prices, rose at an average rate of 14% in the next three years.
Feb 28, 2007, 12:02
Newsletters
:
2007 Newsletters
:
2 March 2007
Singapore's Budget: The government adjusts its tax regime.
Singapore is a small island with few natural resources. Only the skills of its people! Yet it is well known to be running a most successful economy and the secret has been - LOW TAXES!
Singapore have built for themselves a thriving economy and are a wealthy nation - certainly wealthier than New Zealanders even though they didn't exist as a nation when we were up there at number three in the world. From nothing to way ahead of us; they must be doing something right.
Why cannot our politicians use logic and recent experience to observe what is happening around the world and put better policies in place in New Zealand.
Why do we continue to drift off the pace while Singaporeans think logically and understand modern economic thinking to boost their standard of living.
Are we stupid?
This article tells us what Singapore is planning in this year's budget. We have a lot to learn.
Feb 22, 2007, 10:39
Newsletters
:
2007 Newsletters
:
2 March 2007
The Fateful Wish for Price Stability
Four years ago I became concerned about New Zealand's economic growth rate and tried to find out the story behind why we are in decline and what it all means. It has been a long study with more and more meaningful information rising to the top of a world full of misinformation.
The first thing of concern was that New Zealand's position in the world of wealth had dropped from third to nearly 40th and this seemed to be because our GDP was not as high as other countries. However this is only part of the story. Last year our GDP growth rate had dropped to below 2% which is low when compared to average world GDP growth of around 5%. But it also became apparent that our GDP growth came from growth in the government sector. This would not provide any wealth to spread around! We must still be getting poorer!!
But there is also another question - "Are the dollars at the end of 2006 the same as the dollars at the beginning of 2006?"
Since the government has increased the money supply by 16% during 2006 it would seem that the dollars at the end of the year are worth 16% less than the ones at the beginning of the year. So we are not measuring our growth in a constant unit.
In Zimbabwe they know all about this as their cash loses its value so fast they can hardly spend it before it becomes valueless. Toilet paper is worth more, now!
So if GDP has officially increased by 2% as measured in a currency devaluing by 16% over the same time period can we be said to be growing at all?
Now official statistics say that inflation is measured by the CPI which runs at about 3% at the moment. But price increases are the result of money increases. Not the other way round. It is the same as - "Rain causes wet streets, not wet streets causes rain."
Since all Western governments seem to be inflating their money supplies by 10% or more these days we are all probably shrinking at the same rate - all getting poorer.
But this mismanagement of our money supply has many ramifications and we will talk about them in the months ahead. For the moment here is an article with some intriguing thoughts.
Feb 20, 2007, 14:55
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